What Would the Bank Do?

The US trade gap is now at an all time high, having hit $671.7 billion during 2004. Job growth has been slow, and the budget deficit is sitting at $427 billion. Meanwhile, the Treasury Secretary is promising more tax cuts in an attempt to stimulate growth, even though past experiments show that giving tax cuts to the richest 20% is a failure when it comes to envigorating an economy and actually accomplishes the exact opposite.

Let's see if we can put this in perspective for the fiscally-challenged Republicans out there who continue to support this administrations brigandage.

Imagine there is a small business, say a grocery store. The grocery store, for four years now, has been taking in less from what it sells than what it costs to buy from it's suppliers. A lot more. Right now, the grocery store has an overdraft at the bank of $427 billion and owes it's suppliers $671.7 billion. It has consistently cut the wages of it's cashiers and shelf-stackers while every year it manages to increase the windfall bonuses it pays to its mid and upper level management. Right now it is going to the bank, cap in hand, with a plan. It wants to give it's top managers and directors even more in windfall bonuses so that they will work harder for the company. It plans to cut back on the benefits it pays its cashiers and shelf-stackers to help pay for these bonuses. It also wants to buy some shiny new golf-carts for it's overweight security guards even though the last incidence of armed robbery was three years ago and it's current golf carts are more than adequate for the job if they weren't guarding the grocery store down the street. Projections show that pretty soon the overdraft is going to increase dramatically even though it's told the workers that things are looking up and the money it owes it's suppliers isn't going to go down either. Lastly, it plans to loot the company pension scheme and give the money to the directors and managers to play the stock market with.

If you were a bank, would you foreclose?

Sure this is a simplistic analogy, but it isn't that far wrong. No wonder Nancy Pelosi calls Bush's economics "a hoax".